Gazpromthe largest company in Russia and currently controlled by the Russian state, took a new step towards the largest possible natural gas supply agreement in its history with China after nations around the world severed economic and political ties with China. Putin for the invasion of Ukraine.
According to the Bloomberg portal, the gas giant signed a contract to design the Soyuz Vostok gas pipeline through Mongolia to China, according to initial information released by Gazprom itself in a statement.
If Russia reaches a new supply agreement with China, the new gas pipeline Soyuz Vostok It will transport up to 50,000 million cubic meters of natural gas per year to the Asian nation, in the middle of the mountains once traveled by Genghis Khan.
A new supply deal would also allow Gazprom to build an interconnector between its gas pipeline systems to the west and east, allowing Russia to redirect gas to China from fields that now only feed Europe. That would ease the company’s dependence on mainland Europe, currently the largest individual buyer of Russian gas.
Gazprom: from Russia to China
The pipeline design contract comes as the European Union and the US, along with countries including the UK, Canada and Japan, put unprecedented pressure on Russia after President Vladimir Putin ordered the invasion of the neighboring Ukraine.
The sweeping sanctions are limiting the country’s ability to import key technology, enter foreign debt markets and even access much of the $640 billion it has amassed as a buffer to protect the economy.
While Russian energy exports remain unaffected at this stage of the war, Europe has been exploring options to move away from Gazprom deliveries. The firm has been in talks to deliver gas to China through Mongolia for several years.
“Today the design contract has been signed, which means that the project has moved to the stage of practical implementation,” Gazprom CEO Alexey Miller said of the Soyuz Vostok link. The statement did not give any details on the progress of supply negotiations with China.
Russian gas, an old ally for China
In 2014, Gazprom signed a 30-year, $400 billion deal to directly supply up to 38 billion cubic meters of gas per year to China through the Power of Siberia gas link, where deliveries began in late 2019. in recent months, when its flows to Europe were limited, shipments were regularly above daily contract volumes.
In early February, Russia reached a smaller gas deal with China for 25-year direct supplies of up to 10 billion cubic meters per year from fields in the Far East.
The data
- In December 2019, Gazprom and the Government of Mongolia signed a Memorandum of Understanding.
- In January 2022, Gazprom and the Government of Mongolia signed a protocol on the results of the consideration of a feasibility study (FS) for the construction of the Soyuz Vostok gas pipeline.
- The feasibility study of the new laying was prepared by the Soyuz Vostok Gas Pipeline Special Purpose Company.
Source: Larepublica
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